Volkswagen And Ford Team Up On Autonomous Driving, With Volkswagen Investing $2.6 Billion Into Argo AI

Volkswagen and Ford announced further investment into Argo AI to develop autonomous vehicles. [Photo: Ford]

Ford will use Volkswagen’s platform to build a European electric car.

As we roll into 2020, automakers are investing more heavily into autonomous tech, with Ford and Volkswagen announcing significant investment into Ford’s Argo AI autonomous division today. According to a joint statement, Ford plans to build a vehicle based on Volkswagen’s MEB platform for European customers by 2023.

How exactly Volkswagen is investing in Argo is a bit more complex than simply investing a huge lump of money. The German automotive giant will commit $1 billion in funding for Ford’s Argo AI division. On top of that, it will commit $1.6 billion worth of investment with its own Autonomous Intelligent Driving (AID) company. That includes more than 200 employees who worked on developing autonomous tech for Volkswagen. Finally, Volkswagen claims it will purchase $500 million in Argo AI shares from Ford as part of the $1 billion investment.

For its part, Ford plans to invest $600 million in additional funding to Argo AI, as part of a previously announced $1 billion cash commitment.

Volkswagen CEO Herbert Diess and Ford President and CEO Jim Hackett have been working on developing closer ties between the two companies. “While Ford and Volkswagen remain independent and fiercely competitive in the marketplace, teaming up and working with Argo AI on this important technology allows us to deliver unmatched capability, scale and geographic reach,” said Hackett. Ford says it plans to deliver more than 600,000 cars using Volkswagen’s MEB platform over six years. That includes another new Ford model that is still under discussion for European customers.

What about the U.S.?

600,000 vehicles is not a figure to take lightly, although it doesn’t appear Ford is aiming its MEB-platformed cars at the U.S. market just yet. For us, Ford plans to bring out a some sort of Mustang-inspired electric crossover with an illuminated badge. We’ve called it Mach 1 in its early stages, though Ford has distanced this car from that name in recent months. On that basis, its true name remains a mystery.

Volkswagen’s first car on the MEB platform is the ID.3 hatchback, set to hit the European market next year. From there, we’ll eventually see the so-called I.D. Buzz and I.D. Crozz, among others. And yes, they will have different names than their concept counterparts.

Autonomous driving: Taking direct aim at Tesla

There’s no mistaking who Ford and Volkswagen are eyeing as they commit to investing billions in autonomous driving tech. Of course, neither company mentioned Tesla by name, but this is clearly a shot against their bow. Should the largest electric car company in the game watch its back at this point?

It’s always wise to keep an eye on the competition, but Tesla is already on the field with electric cars. What’s more, its currently leaps and bounds ahead insofar as to actually build cars that can drive themselves, at least to some extent. Tesla’s Autopilot system still is not completely autonomous, but they started long before either Ford or Volkswagen financially committed to even building electric cars, let alone working on autonomous driving.

Ford and Volkswagen have a great deal of money to throw around. Until they actually produce these cars in large numbers, though, Tesla has an advantage, for the time being. We’ll have to wait and see what this sort of investment means for us, the consumers, in the next few years.

Zach is a writer and Managing Editor for TFLcar. He has held a lifelong passion for cars, with a particular interest in hot hatchbacks and off-road rigs. Born and raised in Colorado, Zach holds a Bachelor's Degree in English from Colorado State University, and is based in Boulder, Colorado.